Simplicity in TA

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Quote from FreakofNature:

Xspurt,

think indices filling some gaps below now?

FoN
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Sorry FreakofNature, had a little break. Hope to bring us up to date over the W/e.

Last day of the week, last day the month, last day of the quarter, last day of the year. Pretty important for the charts :)

2012 looks like being a very interesting year indeed. More soon
 
Quote from Xspurt:

The Dow reacted with the red tail on the trend line when I made my last post and said that this would not be a sell but that PA was more likely to cough or splutter here and then continue up. It looks like that is what has taken place and now we can get on with the job of moving up.

There is still a price to be paid for this kind of activity as it depletes the energy in the move regardless of the time frame, unless it marks time in a coil to replenish energy. This is not long enough for that so it is eating gas.

There is often a bit of manipulation between now and the NY and the Dow can climb on light volume. Again news is an issue with the Eur specifically vulnerable. This market need to be closely watched over the next 2 or 3 days to make sure it has enough gas to continue. Watch for a double top on the S&P. If we get through that we can run.

The position a trader should have been in is holding long from the lows. It looks like a scalper trade is set up now with potential to run if we can get through the DT.
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More or less as expected, underlying UP pressure but running out of energy so watching that next 2-3 days after posting gave a minor pull back into strength.

A novice got all excited about the pull back telling me I was on the wrong side of the trade and all because of two things...

1) Not understanding how to execute a trade

2) Mistaking a pullback into strength for a short

So here's a holiday present to show how to trade what you see and fit it in to a possible either-way break. My expectation was for a break to the up side because I saw the weekly pressure was still up (although weakening).

However I warned there was minor down pressure that could hit in the next 2-3 days but I was looking at a scalp set up for the long as being the most likely.

I wasn't interested in a short position yet because strength should be in the market until now, the year end.

The proper position is either long and holding from the lows or flat with profits from the up move. If the market broke up and I wanted to scalp this move I need more than an expectation and a green arrow pointing up. I need a trade signal to trigger the execution and this is what my "friend" keeps getting killed on.

If the market continued to the upside how do we execute the trade? An aggressive entry would be on the break of the high of the green bar I had the arrow on. I have a red horizontal for the resistance to trigger this trade.

The problem is there is a more important gold horizontal just a fraction above that and then a major green resistance a fraction above that. So no matter how convinced I am about scalping long I need to see the proof that buyers are taking out these 3 resistance lines or I can expect to get my head handed to me.

As it was there was no move up at all so no trade could be executed unless you were an overexcited novice.

Conversely taking a short into strength results in the big green arrow sucker punch and my "friend" took the bait hook, line and sinker for the short.

No one gets it right all the time - that's not what trading is about. To win means knowing how to play the odds, waiting for the signal to confirm it is safe for the trade execution and bailing if the trade doesn't work.

We finished the year on resistance so what happens next? More to follow...
 

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Hmm ended up a lot busier than I thought I would be over the hols. so going to keep this brief.

Gann said the first 5 to 7 trading days often set the tone for the rest of the year so let's see how that goes.

This years looks like being the most challenging to trade ever with the host of problems on the horizon...

1) I expect natural disasters to continue to increase and the chance is one of these is going to play havoc with some big economy

2) I will be shocked and delighted if we get through 2012 without war in the middle east. If it kicks off there are too many big players too close to the powder keg and it might get nasty with potential for WMD's.

3) The knock effect of a war to oil and then stocks will be greater than we have ever seen.

4) Terrorism could be beyond control

5) Sovereign debt looms like a major firestorm

6) Manipulation of the markets by governments and central banks will likely increase

7) Big player fraud seems to be in an upward trend

8) Regulations to save us from everything from carbon to imagined trading volatility can create a real mess

9) Elvis may return and run the IMF, though that would be a good thing.

What does this all add up to? A wall of worry. What does a bull market climb? Yip - a wall of worry. So having painted a nasty backdrop and being aware we are in an election year when stocks do NOT have a history of crashing, I will need to beware of.. well.. everything :)

The first thing I am going to do before I call a big short is see how the FTSE handles the resistance tomorrow as a lead indicator because the Dow needs to climb about 200 pts to get to such a significant point.

There is the possibility of further strength coming into the market and I love to take a contrarian position if there is strong sentiment for a move. I was bullish for this move up from the lows expecting it to get up here in both time and price. Now we are up here I am not convinced it is over so I need the market to tell me what is next.

In any event nimble trading is going to be a lifesaver against the likelihood of bad news that puts the market into a tail spin.

Watch the FTSE tomorrow.
 

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Ha you're back with yet another ID! There's a shock

Anyway, did you see I posted some advice to help your execution and direction problems?

Happy New Year :)
 
Quote from Xspurt:

Ha you're back with yet another ID! There's a shock

Anyway, did you see I posted some advice to help your execution and direction problems?

Happy New Year :)
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:D


I always wonder who these people are that take time to bother other people on these boards. I don't like hockey. But I would never go to a hockey enthusiast board and post a bunch of crap bothering people who like to talk about hockey. It makes no sense. Maybe I'm just jealous because I don't have that kind of free time lol.

Thanks for the posts though X, hope you keep with the updates on your analysis!
 
Quote from jack411:

:D


I always wonder who these people are that take time to bother other people on these boards. I don't like hockey. But I would never go to a hockey enthusiast board and post a bunch of crap bothering people who like to talk about hockey. It makes no sense. Maybe I'm just jealous because I don't have that kind of free time lol.

Thanks for the posts though X, hope you keep with the updates on your analysis!
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My pleasure Jack. When I get the opportunity I will keep it ticking over :)

... and yes, ET seems to attract a few traders and a lot of weird losers.
 
Quote from Xspurt:

The first thing I am going to do before I call a big short is see how the FTSE handles the resistance tomorrow as a lead indicator because the Dow needs to climb about 200 pts to get to such a significant point.

There is the possibility of further strength coming into the market and I love to take a contrarian position if there is strong sentiment for a move. I was bullish for this move up from the lows expecting it to get up here in both time and price. Now we are up here I am not convinced it is over so I need the market to tell me what is next.

In any event nimble trading is going to be a lifesaver against the likelihood of bad news that puts the market into a tail spin.

Watch the FTSE tomorrow. [/B]
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As I wrote, no reason to sell and the FTSE broke up with the Dow following for the 200 point move to the resistance. If you were not already long you were not going to catch much of the move.

With the FTSE already through this resistance level it should give the Dow some impetus except Santa Claus often runs out of steam in the first 5 to 7 days. I have a friend who uses the first 30mins to map out the day in a similar way to Gann mapping out the year from this 5 to 7 trading day zone.

Let's see how we fare.
 

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